Asia’s SM prices rise $20/tonne over weekend on buoyant crude

18 June 2012 09:56[Source: ICIS news]

SINGAPORE (ICIS)--The prices of styrene monomer (SM) in ?xml:namespace>Asia have risen by around $20/tonne (€16/tonne) over the weekend as buoyant energy futures at around $85/bbl bolstered buyers’ sentiment, market sources said on Monday.

Offers for July parcels were at above $1,300/tonne CFR (cost & freight) China on 18 June, compared with around $1,280/tonne on 15 June, according to ICIS data.

Some buying interest has emerged. “The market is generally still quiet, but bids for August cargoes have appeared at $1,290-1,300/tonne CFR China,” said a trader in Singapore.

Most players in Asia are adopting a wait-and-see stance, preferring to wait for the Europe and US markets to start trading on 18 June before making any commitments.

A numbers of traders in Asia have turned bullish on the market despite the still-weak performance in the downstream styrenics sector.

“The Chinese manufacturing season in the third quarter should spur demand for resins and SM in the near term,” said a South Korean trader.

Others, however, are less sanguine and expect further volatility in the market, given the ongoing debt woes in the eurozone. The weak economic conditions in the US and the economic slowdown in China are also prompting a number of players to remain cautious.

“The market has strengthened after the Greek election over the weekend, but risks remain as there are still a lot of uncertainties out there,” said another trader in Singapore.

Some end-users of SM are emerging from the sidelines to enquire about cargoes and prices, which appeared to have bottomed out.

“If more end-users appear, that will signal that the market could continue to firm,” the South Korean trader added.

SM is a liquid chemical used to make plastic resins such as polystyrene (PS) and acrylonitrile-butadiene-styrene (ABS) as well as synthetic rubbers such as styrene-butadiene-rubber (SBR) and styrene-butadiene-latex (SBL).